Pay Per Click Budget Considerations

Paid advertising such as Pay Per Click is a great way to increase website traffic, but when spending gets out of control it can do more harm than good. You have to understand that not every PPC will end up turning a profit, as some will cause you to lose money. However, with enough testing you can achieve a larger percentage of profitable campaigns.

Setting The Bid Amount

When you pick a keyword to add to your campaign a bid amount must be selected. Depending on the quality of the keyword you might increase the bid to a higher value. The problems arise when you enter a relatively large bid amount, get a lot of clicks and virtually no sales. This can end up being a very expensive test that is just unnecessary. Instead, what you could do is leave the bid at a low amount. This will drive less traffic, but you still get to see what the conversions from that keyword are like. Then if you see that a certain keyword is bringing in a lot of sales you can increase the bid amount to increase the volume of traffic the keyword brings in. This takes a little practice, but once you get into the flow of things it can become second nature.

So many advertisers choose to automate using either the automated bidding option in Google AdWords or a third-party bid management solution. Both approaches have their upsides and downsides – Google’s automated bidding feature is free, but requires you to give up complete control, and it’s less than transparent.

Scaling Things Up

In order to be successful with PPC you can’t rely on a few hundred clicks per day, you must scale things up. However, if things aren’t done right then it can be risky. You must manage the numbers on a daily basis to make sure that a steady stream of profit is generated. This is especially true if the cost of your PPC campaigns is over 75% of your turnover. To arrive at a successful campaign a lot must be managed, as an expert from Biz Wonk explains:

Managing a campaign so that it generates good traffic and good conversions at a price that allows you the profit you deserve, requires attention to many details such as ad content, landing page designation, subtleties of choosing bids, evaluating performance of specific keywords, and more.

The great thing about scaling PPC campaigns nowadays is that you have a lot of options available to avoid scenarios where you spend a lot of money with little return. For example, caps can be placed on how much money is spent on each keyword per day.

You Don’t Have To Win The Bids

A lot of newcomers to PPC campaigns believe that they must win every keyword bidding battle that they enter, but that couldn’t be farther from the truth. The only reason you would want to win a bidding battle with a competitor is so that you can be placed at the top of the pile. However, this isn’t the end goal. The end goal should be to increase your ROI, and at times getting the right mixture of value and low price is the key to doing that. The greatest way to decrease your PPC costs is to have some experience under your belt. As time goes on you will know which keywords aren’t worth the hassle, and which ones you should be concentrating on.